1
South Korea and Asean: Strategic
Partnership for Building an East
Asian Community
Bong Ryull Yang and Norma Mansor
The 21st century is characterised as an era of globalisation and interdependence.
In this era, the relations of South Korea and Association of Southeast Asian Nations
(ASEAN) have progressed significantly. Since South Korea and ASEAN share some
similarities, they sealed the relationship with the establishment of the Sectoral
Dialogue Partnership1 in 1989. Since then, the level of friendship and cooperation
has seen a remarkable increase in terms of economic and cultural links.
The beginning stage of this development started with the establishment of
the Sectoral Dialogue Partnership in 1989, leading to the Full Dialogue Partnership
in 1991 that was elevated to a summit level in 1997. This summit led to the
development of official mechanisms for cooperation in diverse sectors. These
mechanisms were put into practice with the establishment of the Comprehensive
Cooperation Partnership in 2004 wherein ASEAN- South Korea FTAs in commodity,
service and investment were concluded. The First Commemorative ASEAN- South
Korea Summit was held in Jeju Island, South Korea and the ASEAN-Korea Centre
was established in Seoul as an intergovernmental organisation to promote
exchanges between South Korea and 10 ASEAN member countries in 2009. After
two decades, 2010 marked the maturation of the relationship with the upgrading
of the Comprehensive Cooperative Partnership to the Strategic Partnership. From
economic and socio-cultural areas, the cooperation has expanded into political
and security areas.
In 2012, the first resident South Korean Ambassador was appointed to
ASEAN. The ASEAN-South Korea Commemorative Summit, marking the 25th
Anniversary of the ASEAN-South Korea Dialogue Relations that took place
in Busan, South Korea on December 2014 is the most recent development
1
The Sectoral Dialogue Partnership is the initial stage of the official relationship between ASEAN and its
partner which will be gradually upgraded into the Full Dialogue Partnership, the Comprehensive Cooperative
Partnership, followed by the Strategic Partnership.
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The Dynamics of South Korea’s Relationship with Asia-Pacific
symbolising the excellent status and immense potential of ASEAN-South Korea
relations. The summit issued a joint statement acknowledging the deepening
and broadening of the strategic partnership for peace and prosperity.
Meanwhile, within 25 years, trade volume grew to US$135 billion and the
mutual investment amounted to approximately US$4 billion in 2013. Furthermore,
there was a steady increase in the number of visitors traveling between ASEAN
member states and South Korea, averaging more than five million people per year.
In addition to the excellent status in economic fields, the cooperation expanded to
political and security areas to address major global and transboundary challenges
such as international terrorism, climate change and environment. Today, ASEAN is
the second largest trading partner, one of the top five foreign direct investment
(FDI) destinations for South Korea and the preferred destination for the largest
number of South Korean visitors travelling overseas.
This chapter strives for an in-depth examination of the ASEAN-South Korea
partnership in strategic, economic and socio-cultural areas and how they work
together towards building an East Asian Community.
FORGING THE FAR-SIGHTED STRATEGIC PARTNERSHIP
Sharing Strategic Interests between ASEAN and South Korea
ASEAN and South Korea share inherent strategic interests to maintain peace and
prosperity in East Asia. The joint statement of the 25th Commemorative Summit
declared that ASEAN and South Korea agree that it is important to maintain
sustainable peace and stability on the Korean Peninsula and in Northeast Asia.
To this end, ASEAN and South Korea are committed to continue their efforts
to achieve the early denuclearisation of the Korean Peninsula in a peaceful
manner. North Korea’s nuclear weapon development programme has been the
most urgent security issue in the region since the early 1990s when their secret
plan to develop nuclear weapons was first discovered. International efforts
between the concerned parties to persuade North Korea to forgo their plans
have been unsuccessful until now. For example, the Framework Agreement
between the US and North Korea in 19942 was aborted and the Six Party talks3
succeeded to produce the comprehensive agreement so-called ‘19th September
Joint Statement’,4 which failed to be implemented. North Korea had conducted
three nuclear tests since the first in 2006 and is estimated to possess about six
2
The Geneva Agreement requires that North Korea freeze its nuclear reactor and related facilities in exchange
for the provision of two 1,000 megawatts light water nuclear power plants.
3
Six Party Talks have been the main vehicle to deal with the North Korean nuclear issue since the Bush
administration in 2003. It consists of the US, China, Japan, Russia, North and South Korea. Its process has been
stalled since 2009 when North Korea pulled out of it with UN Security Council Presidential Statement condemning
North Korea’s failed satellite launch.
4
The 19th September Joint Statement agrees that North Korea should shut down its nuclear facilities in
exchange for fuel aid and steps toward normalisation of relations with the US and Japan.
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
to 10 nuclear weapons (Baum 2015). If unchecked, North Korea will increase its
stockpiles of nuclear weapons in the future. It is one of the most serious security
concerns in which the international community including South Korea and ASEAN
cooperate to resolve the issue with North Korea in a peaceful manner.
ASEAN and South Korea share similar geopolitical conditions. Southeast Asia
is located in the crucial maritime line between the West and the East, particularly
between Europe and China. Historically, this unique geopolitical feature in Southeast
Asia often resulted in trials and subjugations by the major powers.
Since the early 15th century, colonial powers such as Portugal, Netherlands,
England and France set up their own sphere of influence in Southeast Asia. In
the Cold War era, the region was entangled in ideological and military conflicts
between the US and the former Soviet Union. Only after the end of the Cold War
was the region able to come together under the umbrella of ASEAN regardless of
their diverse political systems to build a regional community based on the spirit
of peace, cooperation and common prosperity.
Similarly, the Korean Peninsula has been a clashing point between
continental and maritime powers. Conflicting interests of neighbouring powers
such as the US, China, Japan and Russia occasionally caused the Korean Peninsula
to be a theatre of military clashes. For example, in 1894 and 1905, Japan
respectively won the war against China and Russia, which took place on the
Peninsula and colonised the Peninsula. After the end of the Second World War, it
was divided into two, leading to the establishment of two different governments
in 1948. The democratic and free government in the south was named the
Republic of Korea, while the communist government in the north was named
the Democratic People’s Republic of Korea. Since then, the Korean Peninsula has
been divided. The Korean War broke out in 1950 and lasted for three years. It was
a great calamity where more than one million Koreans were killed, among them
85 percent were civilians. Almost all infrastructure and manufacturing facilities
were demolished. Furthermore, more than 10 million Koreans were separated,
which still causes tragic humanitarian suffering.
After the confrontation and conflict during the Cold War, the year 2000
onward has marked an era of rapprochement and cooperation. The first InterKorean summit meeting was held in Pyongyang, the capital city of North Korea
between President Kim Dae-Jung of South Korea and Kim Jong-il of North Korea
wherein the historic agreement called the ‘15th June Joint Statement’ was reached.
The statement is a milestone turning the tide from old confrontation and conflict
to new rapprochement and cooperation. The reunion of separated families took
place and the Gaesung Industrial Complex was established about five kilometres
north of the Demilitarized Zone. This joint industrial facility is a symbol of SouthNorth Korean Joint economic cooperation. More than 120 South Korean firms
including garment manufacturing, watch makers, among others, operate within
the area. However, since 2010, South and North Korean relations have stalled.
Former president Kim Dae Jung described the peculiar geopolitical situation
of the Korean Peninsula as akin to four bridegrooms competing with each other
to woo a bride. To overcome this kind of strategic challenge, renowned American
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The Dynamics of South Korea’s Relationship with Asia-Pacific
historian Dr Paul Kennedy said that the Korean peninsula is like a baby elephant
surrounded by four big adult elephants; without good balance, it is easily hurt.
Korea should learn from Belgium’s experience. Belgium was the first victim
of the military conflicts between Germany, France and England. Former French
military and political leader Napoleon Bonaparte attacked Belgium on his way
to conquer England in the early 19th century. In the First and the Second World
War, Germany attacked Belgium on their way to occupy France. Despite the
destruction associated with these attacks, Belgium has become a centre for
European integration wherein the EU Parliament is headquartered.
The geopolitics of ASEAN renders a similar strategic challenge as that of the
Korean Peninsula because the conflicting interests of super powers such as the US,
China and Japan converge on the region. The similar geopolitical features between
ASEAN and South Korea naturally bring them together to make joint efforts to
formulate a kind of mechanism in East Asia that promotes peaceful cooperation
and conflict management. Table 1.1 shows the size and population of ASEAN
and South Korea. ASEAN’s population is third after China and India, increasing
to 625 million in 2013 from 542 million in 2003. The region’s population grew at
an average rate of 1.44 percent annually compared to China’s 0.52 percent and
India’s 1.41 percent during the 10-year period.
Since the partnership was initiated under the visionary leadership of former
president of South Korea Kim Dae Jung and former Malaysian Prime Minister Dr.
Mahathir Mohamad (now Tun), the process has been ongoing to build an East
Asian Community (EAC) since early 2000.
Table 1.1: Size and Population of ASEAN and South Korea, 2013
Countries
Brunei
Area (1,000 km2)
6
Population
(million persons)
0.4
Cambodia
181
15.2
Indonesia
1,860
251.2
Lao PDR
237
6.7
Malaysia
330
29.6
Myanmar
677
55.2
Philippines
300
105.7
1
5.5
513
67.4
Singapore
Thailand
Vietnam
ASEAN
South Korea
331
92.5
4,436
629.4
100
50.2
Source: ASEAN Secretariat
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
Working Closely on Various Regional Cooperation Processes in
East Asia
The first outcome of the regional cooperation process is the East Asia Summit
(EAS), which was held for the first time in Kuala Lumpur in 2005. It consists of 18
member countries including 10 ASEAN member countries, namely South Korea,
China, Japan, the US, Russia and India. EAS is the leader-led forum for strategic
dialogue and cooperation on political, security, economic and social issues of
common regional concern. Because all major powers in the Asia-Pacific region
are EAS members, it could play a pivotal role in maintaining peace and stability
in the region if it works as originally planned. While its potential in that context
has not fully materialised, ASEAN and South Korea should join hands to lead the
forum towards achieving that purpose.
Another important regional mechanism in which ASEAN and South Korea
closely work together is the ASEAN+3 (APT) process which consists of ASEAN
members and China, South Korea and Japan. It began in 1997 when the Asian
financial crisis swept the region to the brink of default. Realising the non-existence
of self-sustainable regional mechanisms, helplessly bewildered Asian countries
had come to the conclusion that a regional contingency formula was needed to
prepare for a future financial crisis. Such was the background of the establishment
of ASEAN+3. While various cooperative projects have been promoted, the most
important outcome is the Chiang Mai Initiative Multilateral (CMIM). CMIM was
a currency swap arrangement established among ASEAN member countries
and China, South Korea and Japan in 2000. However, the initiative did not take
off until the 2008 global crisis when ASEAN countries were faced with currency
difficulties. Hence, in 2009, CMIM became a multilateral entity, whereby ASEAN
countries contributed 20 percent while the remaining 80 percent were from three
countries (16 percent by South Korea; 32 percent by China, including Hong Kong;
and the rest from Japan). The CMIM came into effect on March 2010 with US$120
billion. In 2012, it doubled in size to US$240 billion.
Talks on regional-level cooperation between ASEAN and South Korea
cannot be complete without addressing cooperation at the ASEAN Regional
Forum (ARF). ARF is the only security forum in Asia, which ASEAN initiated in
1994 to foster constructive dialogue and consultation on political and security
issues of common interest and concern, and to make significant contributions
towards confidence-building and preventive diplomacy in the Asia-Pacific region.5
Presently, 27 countries participate in the ARF process including the US, China,
Russia, Japan, South Korea and North Korea.
From the Korean perspective, ARF is important in two ways. Firstly, both
North and South Korea participated in the process of ARF. In this context, ARF
could be instrumental in bringing both nations together to ease tension and
come to terms with rapprochement and cooperation. The second is that ARF
5
This is included at the first ARF Chairman’s Statement in 1994.
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The Dynamics of South Korea’s Relationship with Asia-Pacific
could be similar to the European Organisation of Security and Cooperation (OSCE)
type of security and cooperation in East Asia. The OSCE has 57 members and is
the world’s largest security organisation concerned with early warning, conflict
prevention, crisis management and post-crisis management. It originated in
1975 as the Conference on Security and Cooperation in Europe held in Helsinki,
Finland. This process brought together countries of the West and the East during
the Cold War and contributed substantially to its end through the promotion of
political and economic cooperation and improvement of human rights in the
East. ASEAN and South Korea are interested in creating a region-wide security
mechanism like OSCE in East Asia to primarily prevent conflict and manage crisis
in a peaceful manner.
Table 1.2: Summary of Key Events between ASEAN Member Countries
Year
Key Event
1967
ASEAN was established by the five original member countries, namely
Indonesia, Malaysia, Philippines, Singapore and Thailand
1976
The First ASEAN summit was held and Bali Concord I agreement reached
1978
First ASEAN-European Economic Community ministerial meeting held in
Brussels.
1992
Removal of import taxes on selected goods among ASEAN member countries.
1994
Establishment of the ASEAN Regional Forum (ARF)
1997
First meeting of ASEAN with dialogue partners from China, Japan and South
Korea.
2000
The establishment of CMIM to assist ASEAN and East Asian countries to defend
their currencies and economies in times of crises.
2003
The Bali Concord II was reached to set up the establishment of the ASEAN
Economic Community supported by three pillars; political and security
cooperation, economic cooperation and socio-cultural cooperation.
2004
The ASEAN bloc and China sign the China-ASEAN Free Trade Accord to remove
tariffs by the end of the decade
2005
First meeting of the ASEAN plus Six, also called the East Asia Summit,
comprising ASEAN countries plus China, Japan, South Korea, India, Australia
and New Zealand
2007
ASEAN bloc members agree charter to ratify for the formation of AEC
2008
Establishment of AEC
2011
Bali Concord III agreement
Source: ASEAN Secretariat
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
Table 1.3: ASEAN and Other Economic Blocs, 2013
ASEAN
EU
NAFTA
MERCOSUR
World
Nominal GDP
(US$ billion)
2,406.5
(3%)
17,371.6
(23%)
19,883.2
(27%)
3,189.7
(4%)
73,982.1
Nominal GDP per
capita (US $)
3,908.7
34,281.2
47,981.70
11,294.10
10,384.10
615.7 506.7 (7%)
(9%)
473.6
(7%)
282.4
(4%)
7,124.50
Population
(million persons)
Surface Area
(1,000 km2)
4,326.1
(3%)
4,324.8
(3%)
20,199.4
(14%)
Merchandise
Trade (US$ billion)
2,528.2
(7%)
11,620.8
(32%)
5,613.5 (15%)
12,650.5 148,940.00
(8%)
837.8
(2%)
36,890.20
Source: ASEAN Secretariat
MUTUALLY BENEFICIAL COMPLEMENTARY PARTNERSHIP
Economic Relationship
Economic cooperation is the main driver to enhance friendly and cooperative
relations between ASEAN and South Korea. The economies of ASEAN and South
Korea are deeply complementary whereby ASEAN is rich in natural resources
while South Korea is not. On the other hand, South Korea registered significant
economic growth earlier than most ASEAN member countries6. The different
stages of economic development have led to deeper and broader economic
cooperation between them after South Korea’s joining the production network in
this region. Since the mid-1980s, Japan rapidly expanded its overseas investment
and Official Development Assistance (ODA)7 in this region, which made a decisive
contribution to the establishment of the production network8 with ASEAN
member countries. South Korea joined the Newly Industrialising Economies (NIE)9
in the late 1980s and has been rapidly expanding trade and investment in ASEAN.
6
In East Asia, Japan led the economic growth thrust in 1950s and NIEs followed it. NIEs comprise South Korea,
Singapore, Hong Kong and Taiwan. Some ASEAN countries and China were next to NIEs in this economic growth
thrust in East Asia.
7
ODA is provided by official agencies including state or local governments to promote the economic
development and welfare of developing countries and is concessional in character and conveys a grant element
of at least 25 percent according to the definition of DAC and OECD.
8
The production network consists of the vertical production chains extended across the countries in the
region. The network involves a large number of countries at different income levels. Cross-country differences
in factor prices and other location advantages are effectively utilised in the formation of the vertical production
chain.
9
NIEs comprise Korea, Singapore, Hong Kong and Taiwan. In Asia, Japan was the first to industrialise in the
1950s, followed by NIEs in the 1970s and some ASEAN members such as Malaysia in the 1980s.
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The Dynamics of South Korea’s Relationship with Asia-Pacific
Table 1.4 shows the economic indicators of ASEAN+3 for 2014. The ASEAN
region is set to become a major global economic force, with the combined GDP
of member states’ economies growing by 4.6 percent in 2014 compared with 5.2
percent in 2013 and with the global growth of 3.4 percent. Between 60 percent
and 70 percent of GDP in ASEAN economies grew faster than the global average
(Figure 1.1). They also account for six percent of the world economy (3.2 percent
in nominal terms). Most ASEAN economies are heavily dependent on trade.
Removal of trade barriers and enhancement of trade facilitation are among the
most important and earliest economic integration initiatives that ASEAN has been
pursuing which lead to more open economies and increase in trade performance.
In 2014, the member states’ annual GDP growth ranged from five to
eight percent, namely, Lao PDR (by 8.5 percent), Myanmar (by 8.2 percent), the
Philippines (by 7.2 percent) and Cambodia (by 7.4 percent) and recorded the
highest GDP growth among the 10 ASEAN countries. GDP per capita of the
member countries and South Korea varied, ranging from $37,000 to less than
US$1,000 in 2014. South Korea, Singapore and Brunei posted a GDP per capita
above US$20,000 while Myanmar and Cambodia’s GDP per capita stood at less
than US$1,000. The GDP per capita in Indonesia, Malaysia, the Philippines and
Thailand ranged from US$1,500 to US$7,000.
Table 1.4: Key Economic Indicators of ASEAN and South Korea, 2014
Country
Brunei
Annual
GDP
growth (%)
GDP per
capita
(US $)
GDP*
(US$
billion)
Imports of
goods
and
servicesa
Exports of
goods
and servicesa
-1.75
24,554.09
10.10
4.16
5.30
Cambodia
7.36
711.16
10.72
7.43
7.28
Indonesia
5.58
1,787.50
449.14
140.67
160.18
Lao PDR
8.52
774.11
5.09
2.35
1.90
Malaysia
4.73
7,057.48
207.95
171.48
186.23
Myanmar
8.24
n/a
n/a
n/a
n/a
Philippines
7.18
1,594.82
155.61
70.57
64.89
Singapore
4.44
37,491.08
202.42
383.32
444.64
Thailand
2.89
3,415.37
230.37
182.46
189.39
Vietnam
5.42
1,028.63
92.28
84.85
80.87
South Korea
3.31
24,565.56
1,238.69
531.35
653.57
Constant 2005 US$ billion
Source: World Bank Development Indicators, 2015
a
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
Figure 1.1 Real GDP Growth of Selected Countries (Annual percent)
Brunei
Cambodia
Lao PDR
Malaysia
Philippines
Singapore
Thailand
Vietnam
Indonesia
South Korea
World
*Data from Myanmar is not available
Source: World Bank Development Indicators, 2015
ASEAN is the second largest trading partner for South Korea while South
Korea is the fifth largest trading partner for ASEAN. In 2013, trade volume was
approximately US$135 billion and is set to exceed US$150 billion in 2015. Its
growth rate between 2009 and 2013 was remarkably rapid at 80 percent.
Table 1.5: South Korea’s Major Trading Partner
Year
2009
2010
2011
2012
2013
1
China
(140.9)
China
(188.4)
China
(220.6)
China
(215.0)
China
(228.9)
2
EU
(78.8)
ASEAN
(97.3)
ASEAN
(124.9)
ASEAN
(131.1)
ASEAN
(135.3)
3
ASEAN
(75.0)
EU
(92.2)
Japan
(108.0)
Japan
(103.1)
EU
(105.1)
4
Japan
(71.1)
US
(90.2)
EU
(103.1)
US
(101.9)
US
(103.5)
5
US
(66.6)
Japan
(92.4)
US
(100.7)
EU
(99.3)
Japan
(94.0)
Unit: US$ billion
Source: Trade Statistics, Korea International Trade Association (KITA)
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The Dynamics of South Korea’s Relationship with Asia-Pacific
Figure 1.2 clearly shows that trade between ASEAN and South Korea started
to pick up in the middle of the 1990s. Trade in the ASEAN region is dependent
on a few commodities, with the top 20 import and top 20 export commodities
constituting more than half of ASEAN imports and exports. The top five import
and top five export commodities represent around one-third of ASEAN imports
and exports. ASEAN imports of the top 10 commodities are highly concentrated
from a few major trading partners. South Korea is a very important export market
for Brunei at 16 percent and a key import supplier for Vietnam at 16 percent
(ASEAN Trade Report 2014). More than 75 percent of ASEAN exports to South
Korea consists of intermediary textile products and woven fabrics.
Figure 1.2: South Korea’s Trade with ASEAN, 1972 – 2014
Source: Trade Statistics, KITA
Investment is another indicator for robust economic relations between
ASEAN and South Korea. The first South Korean FDI in ASEAN was made by the
South Korean Development Corporation to develop forests in Indonesia in 1968
(Leong 2007). Investments from South Korea to ASEAN began to increase in the
late 1980s to 1990s. However, the amount was relatively minimal. In 1985, the total
FDI made by South Korea to ASEAN was only US$16.1 million. The figure began to
increase over the years, with US$254.1 million in 1990 reaching US$415.1 million
in 1995. In 2013, South Korea’s total investment in ASEAN amounted to US$3.8
billion, which was the third largest after the US and China. Its growth throughout
the years can be considered fairly remarkable. Compared with that, in 2005, its
growth rate was approximately 78 percent. About 15 percent of South Korea’s
total FDI during the 10-year period from 2003 to 2013 went to ASEAN. In 2013,
South Korea was the eighth biggest investors in ASEAN after Japan, Netherlands,
UK, China and the US. This growth may be due to the liberalisation policies in the
host countries towards FDI as well as the comparatively lower wages in ASEAN.
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
Table 1.6: South Korea’s FDI to ASEAN
Year /
Destination
2009
ASEAN
Total
2010
2011
2012
Accumulated
(2003-2013)
2013
2,126
4,404
4,928
4,423
3,791
29,184
20,420
24,468
27,591
25,119
24,053
193,469
10.4
18.0
17.9
17.6
15.8
15.1
Percentage
Unit: US$ million
Source: Export-Import Bank of South Korea
These investments drove the export performance of the ASEAN member
states. Tables 1.7 and 1.8 show the export and import profile of ASEAN member
states.
Table 1.7: ASEAN Top 10 Export Products*, 2013
Rank
HS Code
Products
Value
1
85
Electrical, electronic equipment
259,228
20.9
2
27
Mineral fuels, oils, distillation
products, etc.
225,407
18.1
3
84
Boilers, machinery etc.
138,045
11.1
4
15
Animal, vegetable fats and oils,
cleavage products
43,348
3.5
5
40
Rubber and articles thereof
42,733
3.4
6
87
Vehicles other than railway, tramway
40,027
3.2
7
39
Organic chemicals
39,324
3.2
8
29
Plastics and articles thereof
36,568
2.9
9
99
Commodities not elsewhere
specified
35,064
2.8
10
90
Optical, photo, technical, medical,
etc. apparatus
31,886
2.6
Top 10 Major Products
891,630
71.7
Others
351,147
28.3
1,242,777
100
Total
Share
*Data from Myanmar is not available and excluded from total
Source: PC-TAS (International Trade Centre)
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The Dynamics of South Korea’s Relationship with Asia-Pacific
Table 1.8: ASEAN Top 10 Import Products, 2012
Rank
HS
Code
1
27
Mineral fuels, oils, distillation products, etc.
269,494
22.4
2
85
Electrical, electronic equipment
235,758
19.6
3
84
Boilers, machinery etc.
159,766
13.3
4
72
Iron and steel
43,202
3.6
5
87
Vehicles other than railway, tramway
41,346
3.4
6
39
Plastics and articles thereof
39,023
3.2
7
71
Pearls, precious stones, metals, coins, etc.
28,493
2.4
8
90
Optical, photo, technical, medical, etc.
apparatus
27,507
2.3
9
29
Organic chemicals
25,840
2.1
10
73
Articles of iron or steel
Products
Value
Share
24,012
2.0
Top 10 Major Products
894,441
2.0
Others
310,508
25.8
1,204,949
100
Total
*Data from Myanmar is not available and excluded from total
Source: PC-TAS (International Trade Centre)
To name a few large and successful South Korean investment cases in
Southeast Asia, the first is Samsung Electronics Co.’s Malaysian investment. Since
it started from the late 1980s, the total accumulated amount of investment
reached US$2 billion, which is one of the largest among foreign investments in
Malaysia. Its manufacturing complex is located in Seremban, Negeri Sembilan. A
gas development project in Myanmar initiated by Daewoo International in 2000 is
another case in point that has succeeded in detecting huge gas reserves in Shwe
gas fields located off the coast of Myanmar. It started to produce gas in 2013,
sending it to China through a series of subsea and overland pipelines. Samsung
Electronics is another huge investment in Vietnam producing approximately 60
percent of mobile hand phones of the total Samsung mobile phone production
and accounts for some 25 percent of Vietnam’s total exports.
In this profound trend of robust economic cooperation, two things are
noteworthy. One is the conclusion of ASEAN-South Korea FTAs to expedite and
facilitate economic cooperation. ASEAN- South Korea FTA in commodities was
concluded in 2006, followed by FTA in Services and in investment in 2007 and
2009, respectively. At the Commemorative Summit Meeting in Busan in 2014, an
agreement was made to further liberalise and improve the ASEAN-South Korea
FTA by 2015 to increase the mutual trade volume up to US$200 billion by 2020.
The other noteworthy point is South Korea’s contribution to the formation of the
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
ASEAN Community. South Korea has made contributions of US$57 million as an
ASEAN-South Korea Special Cooperation Fund and provided US$2.13 billion as
grants or commercial loans from 1990 to 2012. ASEAN members are in diverse
stages of economic development. South Korea has exerted her utmost effort to
assist the economic development for some developing ASEAN member countries.
Among others, the establishment of the ASEAN Innovation Centre was agreed at
the 2014 Commemorative Summit Meeting to improve the innovative capability
of ASEAN countries, maximise human capital development in ASEAN and improve
the competitiveness of small- and medium-sized enterprises.
People-to-People Exchange
Another peculiar phenomenon illustrating the rapidly-growing relations between
ASEAN and South Korea is the people-to-people exchange. Three areas are
especially outstanding. The first is tourism. Visitor numbers have been increasing
exponentially and doubled to 6.5 million from 2009 to 2013. Southeast Asia is the
top tourist destination for South Koreans while South Korea is emerging as an
attractive tourist destination for East Asia. For example, Kota Kinabalu is one of the
most popular destinations for South Korean honeymooners and it is interesting
to observe that more and more people living in ASEAN are visiting South Korea
in winter to enjoy winter sports like skiing.
To illustrate this further, Tables 1.9 and 1.10 show tourists travelling between
South Korea and ASEAN countries. In 2013, 32.4 percent of South Korean tourists
visited ASEAN countries, which registered an increase of 19.7 percent since 2007
(Table 1.9). Thailand and Philippines received the highest number of South Korean
visitors annually, followed by Vietnam and Malaysia. Meanwhile, the share of
visitors from ASEAN to South Korea has also seen an increase from 9.7 percent
in 2002 to 12.8 percent in 2013. The majority of tourists from ASEAN countries
are from the Philippines, Thailand, Malaysia and Indonesia.
The second area is education and human development. South Korea
has increased scholarships and promoted student and faculty exchanges and
joint research in higher education with ASEAN. South Korea has also increased
opportunities for ASEAN students for technical and vocational education. To
this end, the international college student exchange programmes, the ASEANSouth Korea Academic Exchange program and the ASEAN Millennium Leaders
College Student Exchange Program have been initiated. The ASEAN- South Korea
Scholarship for South Korean Studies Programme has been ongoing since 2010.
Table 1.11 shows the number of South Koreans living in ASEAN countries
and the flow of South Korean students into ASEAN institutions of higher learning.
Table 1.12 depicts the total number of students from ASEAN studying in South
Korea. While the percentage share of ASEAN students relative to those from other
origins fluctuated over the years, the actual number of students from ASEAN
countries registered a substantial increase from 158 in 1990 to 14,961 in 2013.
Half of them are from Brunei.
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The Dynamics of South Korea’s Relationship with Asia-Pacific
Table 1.9: South Korea’s Outbound Travel by Destination Country
Destination
Brunei
2007
2008
2009
2010
2011
2012
2013
3.8
17.5
1.6
1.7
1.7
4.3
Cambodia
329.9
266.5
197.7
289.7
342.8
411.5
435
Indonesia
337.2
331.4
260.3
296.1
320.1
303.9
324.6
Lao PDR
13.1
18.1
17.9
27.3
26.6
53.8
53.8
Malaysia
224.9
367.5
227.3
264.1
263.4
284
274.6
Myanmar
4.3
13.8
12.4
12.5
18.9
20.2
34.8
34.8
Philippines
653.3
611.6
497.9
740.6
925.2
1,031.2
1,165.8
Singapore
480.1
435.7
284.6
379.3
414.9
345.2
471.8
1,083.7
889.2
618.2
805.4
1,014.3
1,169.1
1,308.7
475.4
449
360.1
495.9
535.7
700.9
748.7
3,615.2 3,398.9 2,478.1
3,319
3,864.9
4,338.7
4,822.1
Thailand
Vietnam
ASEAN
World
Percentage
Share (%)
13,325.0 11,996.1 9,494.1 12,488.4 12,693.7 13,737.0 14,846.5
27.13
28.33
26.10
26.58
30.45
31.58
2004
2006
2008
2010
2012
32.48
Unit: 1,000 people
Source: ASEAN Tourism Database
Nationality
2002
2013
Brunei
0
1
1
1
1
2
2
Cambodia
1
2
4
7
7
19
21
Indonesia
57
62
63
81
95
149
189
Lao PDR
0
0
1
1
2
3
6
Malaysia
56
94
90
84
114
178
208
Myanmar
31
29
41
51
58
68
63
Philippines
211
213
248
277
297
331
401
Singapore
71
85
88
96
113
154
175
Thailand
73
103
129
161
261
387
373
20
34
46
76
90
107
117
520
5,347
623
5,818
711
6,155
835
6,891
1,038
8,798
1,398
11,140
1,555
12,176
9.73
10.71
11.55
12.12
11.80
12.55
12.77
Vietnam
ASEAN
World
Percentage
Share (%)
Unit: 1,000 people
Source: Korea Tourism Statistics (KTO)
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
Table 1.11: Total South Koreans Overseas, 2013
Country
Brunei
Green-card holder
4
Resident
Student
115
7
Cambodia
-
4,307
57
Indonesia
814
38,401
664
Lao PDR
6
960
167
Malaysia
50
11,490
2,450
Myanmar
Philippines
Singapore
Thailand
Vietnam
Total
-
2,035
48
785
55,974
31,316
2,267
14,867
3,039
114
17,098
2,735
-
83,668
2,330
3,002
222,942
38,349
Source: Overseas South Koreans’ Status (Korea Ministry of Foreign Affairs and Trade)
The third phenomenon that demonstrates the growing relations between
ASEAN and South Korea is cultural exchange. Hallyu, the Korean wave is the
most conspicuous and is part of the worldwide Korean cultural pop culture
phenomenon. PSY’s Gangnam Style was a big hit worldwide with over 1.6 billion
YouTube views. Hallyu reminds me of many delightful but somewhat embarrassing
moments during my diplomatic service in Kuala Lumpur as Ambassador of South
Korea to Malaysia from September 2007 to August 2010. It was delightful to
witness the love for South Korean films and pop songs among South-East Asian
people, especially youngsters, but it was also embarrassing because most of the
questions they asked me were of South Korean films or dramas and many of the
actors and K-pop singers were unfamiliar to me.
This unique trend is also true in other East Asian countries and plays a
positive role towards enhancing awareness and closer bonds between South
Korea and ASEAN. According to the survey titled “Southeast Asian Perceptions of
Korea” by the South Korea Institute of Southeast Asian Studies in 2011 (Park 2011),
Hallyu was rated positive, exceeding the neutral point in all member countries
of ASEAN. According to the paper titled “The Korean Wave in Southeast Asia: An
Analysis of Cultural Proximity and the Globalisation of Korean Cultural Products”
since the late 1990s (Suh, Cho and Kwon n.d.) Hallyu has been introduced to
Vietnam, then Thailand, Malaysia and Indonesia. The order of entry of cultural
genre was dramas, movies and popular music. The provision of the programmes
by the South Korean government initiated Hallyu by breaking the cultural barrier
between the two countries and paved the way for other cultural products while
the cultural marketing of South Korean companies provided the momentum for
growth, enabling South Korean cultural products to be firmly rooted in Vietnam.
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The Dynamics of South Korea’s Relationship with Asia-Pacific
Table 1.12: Number of Students from ASEAN studying in South Korea
Country
Brunei
1990
1995
2000
2005
79
164
443
1,221
2010
2013
5,748
7,511
Cambodia
0
0
5
41
265
345
Indonesia
7
10
32
54
527
962
Lao PDR
0
0
0
16
85
83
Malaysia
65
115
51
241
609
714
Myanmar
2
6
65
81
229
292
Philippines
2
7
126
78
482
583
Singapore
1
2
2
5
67
279
Thailand
2
5
39
48
400
432
Vietnam
0
19
12
616
3,005
3,760
Total from ASEAN
World
158
803
328
1,487
775
5,628
2,401
26,677
11,417
106,874
14,961
81,847
Percentage Share
(%)
19.7
22.1
13.8
9.0
10.7
18.3
Note: The ferm ‘students’ refers to elementary-middle high schoolers, language trainees, college
and higher education.
Source: South Korea Immigration Service Statistics (South Korea Immigration Service)
The entry path of South Korean cultural products in Malaysia significantly
differs from other Asian countries such as China, Japan and Vietnam. The entry
was relatively late compared with other countries in the region and the initial
response was not agreeable. Only since 2000 have South Korean TV dramas and
movies become popular among Malaysians followed by South Korean popular
music. The South Korean cultural products which gained popularity in China,
Taiwan and Hong Kong were transferred to Kuala Lumpur through overseas
Chinese trading networks. In 2002, Hallyu began in Malaysia with a big hit by
the South Korean TV drama, Winter Sonata, followed by Jewel in the Palace and
the Autumn in my Heart. Nowadays, K-pop leads Hallyu in Malaysia. Since TVXQ
performed for the first time in Malaysia in 2006, K-pop stars such as Rain, Super
Junior and Wonder Girls have become wildly popular.
A two-way flow is important in people-to-people exchange. One-sided
exchange tends to result in rapid cooling off. In that sense, the South Korean
government proposed at the 25th Commemorative Summit last year to establish
an ASEAN Culture House to enhance understanding of ASEAN and Southeast
Asian culture in South Korea. The South Korean government will be in charge of
the infrastructure while ASEAN countries will provide the cultural content.
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
TOWARDS BUILDING AN EAST ASIAN COMMUNITY (EAC)
Regionalism has been on the rise globally since the late 1980s. The first mover
was Europe. Directly after the end of the Second World War, Europeans worked
towards integrating Europe because they were tired of a nation state system
which caused unprecedented catastrophes in Europe with the previous two
world wars. The first entity was the European Coal and Steel Community (ECSC).
It was formally established in 1951 with the Treaty of Paris, signed by six European
countries: France, West Germany, Italy, Belgium, the Netherlands and Luxembourg.
The treaty was to create a common market for coal and steel among its member
states. The ECSC was the first regional organisation based on the principles of
supranationalism. The ECSC was first proposed by French foreign minister Robert
Schuman in 1950 as a way to prevent further wars between France and Germany.
From this market integration of two minerals, the seeds of integration of the whole
economy of Europe were sown.
The region-wide economic integration entity called the European Economic
Community (EEC) was created by the Treaty of Rome in 1957 and signed by the
same six countries. It began as a customs union, having evolved into a single
market, next into EU in 1994 and finally, a monetary union in 1999. Today, EU is
not only a regional economic body, but also a politically integrated entity to fulfil
a dream of the “United States of Europe” though it faces a grave challenge after
the 2008 global economic crisis.
There is no such regional integration entity in East Asia, however, ASEAN
exists in the sub-regional level. Its process has been slow and strenuous. ASEAN
started as a security-oriented regional association and has grown into a mover
and shaker to play a central role in East Asia. Since its inception in 1967, ASEAN
has made every effort to establish the ASEAN Community by 2015. It has three
pillars: ASEAN Political-Security Community (APSC), ASEAN Economic Community
(AEC) and the ASEAN Socio-Cultural Community (ASCC). APSC envisages three
key characters: a rule-based community of shared values and norms; a cohesive,
peaceful, stable and resilient region with shared responsibility for comprehensive
security; and a dynamic, outward-looking region in an increasingly integrated
and interdependent world. The key character of AEC is as a single market and
production base, a highly competitive economic region, a region of equitable
economic development and one that is fully integrated into the global economy.
Finally, ASCC envisages the following characteristics: human development,
social welfare and protection, social justice and rights, ensuring environmental
sustainability, building the ASEAN identity and narrowing the development gap.
If integrated economically, politically, and socially as envisioned, ASEAN has huge
potential. It has over 600 million people and its labour force is the world’s third
largest. It will emerge in 2050 as the world’s fourth largest economy. As ASEAN
Chair in 2015, Malaysia should bear the responsibility of propelling ASEAN to
emerge as a community as the way forward for Southeast Asia.
While ASEAN has concentrated on its own integration, there have been
strenuous efforts in East Asia for region-wide cooperation. It started with
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The Dynamics of South Korea’s Relationship with Asia-Pacific
launching Asia-Pacific Economic Cooperation (APEC) in the late 1980s. When the
financial crisis swept East Asia in 1997, ASEAN leaders invited leaders of China,
Japan and South Korea to its annual ASEAN Summit Meeting in Kuala Lumpur
on December 1997. It was the first ASEAN+3 Summit meeting. The financial crisis
gave impetus to the region to formulate its own regional cooperation mechanism.
At the following ASEAN+3 summit meeting in Hanoi in 1998, the South Korean
president Kim Dae Jung proposed to set up the ‘Vision Group’ with the primary
purpose to study how to strengthen regional cooperation. According to the
final report submitted to the 2002 APT summit meeting, creation of the East
Asia Summit (EAS) and the agreement of East Asia FTA were the most important
proposals in the long-term basis. EAS was officially launched in 2005 and has
proposed the formation of the Regional Comprehensive Economic Partnership
(RCEP) in 2012 to promote free trade in East Asia.
Further to it, a report by the East Asia Vision Group II (EAVG II) proposed an
approach based on three pillars to promote community building in East Asia.
The first is a political-security pillar. To that end, the report proposes prioritising
cooperation to promote good governance, strengthen the rule of law and
promote and protect human rights through policy dialogue and capacitybuilding activities. The EAVG II further proposes to strengthen policy dialogue
and capacity- building activities in the political and security area and to enhance
security cooperation such as non-traditional security issues particularly on
counter-terrorism, cybercrimes and maritime security. The second is the economic
pillar. The EAVG II proposes to establish the East Asia Economic Community (EAEC).
EAEC will be composed of four key elements: (1) single-market and production
base; (2) financial stability, food and energy security; (3) equitable and sustainable
development; and (4) constructive contribution to the global economy. The
establishment of the Regional Comprehensive Economic Partnership (RCEP) is
the key element to create a single market and production base. Negotiations
on RCEP started in 2012 by ASEAN+ 3, India, Australia and New Zealand to
create a kind of regional FTA in East Asia. It aims to finalise negotiations by 2015.
Regarding financial stability and food and energy security, recommendations
are made to explore the possibility of establishing an East Asia monetary fund
and the expansion of local currency bond market. For the equitable economic
development of the region, the setting-up of a possible East Asia Infrastructure
Investment Fund is recommended.
The third pillar is socio-cultural. In this area, human resource development
is emphasised because the global economy is rapidly transforming itself into
a knowledge-based digital economy. Human development in East Asia aims
for extended life expectancy and a higher standard of living. East Asia’s caring
and sharing society will emphasise the value of sustainable development,
strengthened social protection and closer cooperation within the region in
various social policies, disaster and natural resources management as well as
food and health issues. East Asia will respect human rights of all genders, ages,
nationalities and physical ability and expect multinational cooperation to act in
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South Korea and Asean: Strategic Partnership for Building an East Asian Community
socially responsible ways. The cultural heritage of East Asia should be preserved
and promoted, while attempts at cultural innovations should be encouraged
and pursued. East Asia should strive to become a cultural and heritage centre
in the 21st century. In this regard, it is quite encouraging that the South Korean
government has made an investment of around US$800 million to build the
Asian Culture Complex in Gwanju City, the centre of the Southwestern Korean
Peninsula. It is a cultural facility promoting the creation and production of new
cultural content through the collection and research on Asian cultural assets.
The follow-up to the EAVG II report will be submitted to the 18th APT Summit
which was held in Kuala Lumpur, Malaysia in late 2015. The final report will provide
a detailed blueprint for building an East Asian Community by 2020 as envisaged
at the Vision Group II report. There is still a long way to go to realise an East Asia
Community, but as the South Korean proverb goes, a journey of a thousand miles
begins with a single step. ASEAN and South Korea together with other EAC should
do their utmost to realise the formation of an East Asian Community to promote
peace and prosperity in the region.
REFERENCES
Baum, S. (2015). ‘Deterrence, without Nuclear Winter.’ Bulletin of the Atomic Scientists. 9th
Mar. 2015. http://thebulletin.org/deterrence-without-nuclear-winter8083.
Leong, H. K. (2007) ASEAN-Korea Relations: Security, Trade and Community Building. Institute
of Southeast Asian Studies.
Park, S. Y. (2011). Southeast Asian Perceptions of South Korea. The KISEAS Research Series
No. 7, Myung in publishers.
Suh, C. S. Cho, Y. D. Kwon, S. Ho (n.d.) World Congress of Korean Studies. Retrieved from:
http://congress.aks.ac.kr/orean/files/2_1358476377.pdf.
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